MONDAY, OCTOBER 3, 2016
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Baha Mar set for ‘two sales’ By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net
Baha Mar’s secured creditor has acquired the project from its receivers for a sum “substantially higher” than that offered by the top bidder, in order to facilitate its construction completion. The pathway to the $3.5 billion development’s completion, and eventual opening, is disclosed by Supreme Court Justice, Ian Winder, who reveals that Baha Mar will be sold ‘twice’. The first sale is from the Deloitte & Touche receivers to a special purpose vehicle (SPV) owned by Chi-
China bank creates SPV to buy assets from receivers SPV offer ‘substantially higher’ than all bidders Prospective buyer came ‘outside bidding process’ Bank’s SPV to buy $192m claim sought by Sarkis
na Export-Import Bank, the project’s $2.45 billion secured creditor. This deal, which values Baha Mar on an ‘as is’ basis, meaning the present value of its incomplete real estate assets, will move the Cable Beach resort development out of receivership. Justice Winder, in his September 27, 2016, ruling said China Export-Import Bank was only willing to invest “hundreds of millions of dollars” in completing Baha Mar if the project was removed from receivership. Once Baha Mar has been completed, under the ownership of the bank’s SPV, the ‘second’ or final sale will occur.
This will see a controlling interest in the SPV being sold by China Export-Import Bank to the intended purchaser. Justice Winder’s ruling does not confirm the identity of Baha Mar’s prospective buyer, but it reveals that its purchase price “remained lower” than that offered by the China ExportImport Bank-controlled SPV to the receivers. Other revelations contained in Justice Winder’s ruling include: * The Baha Mar ‘buyer’ is a group who emerged “outside the bidding process” set up by Deloitte & Touche See pg b7
New mobile operator Baha Mar companies ‘bang on roll-out goal’ put in full liquidation By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net The Bahamas’ second mobile operator and its controlling shareholder yesterday said they were “bang on target” in meeting its first roll-out milestone, describing this and the launch of services as “a miracle”. Top NewCo2015 and Cable Bahamas executives confirmed to Tribune See pg b4
‘Miracle’ to meet first target in three months NewCo offering service, full launch just ‘weeks away’ Targeting 135 staff, 115 Bahamian, before year-end
AML to add 40 jobs with two Carl’s Jr sites By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net AML Foods will create 40 jobs with the opening of two more Carl’s Jr. outlets before Christmas, with its inaugural location have experienced 20-30 per cent weekly sales growth in recent months. Gavin Watchorn, the BISX-listed food retail and franchise group’s chief executive, told Tribune Business that the sales growth suggested it was time to expand Carl’s Jr’s volume. “You’re going to see some significant changes with Carl’s Jr. in a little short while,” he said of the group’s hamburger franchise. “It’s taken longer than
Follows 20-30% weekly sales growth at first outlet
By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net
Seven Baha Mar companies have now been placed into full liquidation by the Supreme Court, prompting a well-known QC to say he “can’t understand” the legal strategy pursued by original developer, Sarkis Izmirlian. Justice Ian Winder last week appointed Baha Mar’s joint provisional liquidation team Bahamian accountant Ed Rahming and his UK counterparts, Nicholas Cropper and Alastair Beveridge, as full liquidators of the Baha Mar group entities. This move effectively means Mr Izmirlian and his family now face the total loss of their $800-$900 million equity investment
Sarkis, Scotia face wipe out as equity holders QC ‘can’t understand’ original developer’s strategy Provisional liquidators get nod; Sarkis’s E&Y ‘no go’ in the Baha Mar project, which includes land assembled for the 600-acre development. Wayne Munroe QC, who represents the Gaming See pg b4
Baha Mar pictured during a tour by Prime Minister Perry Christie. Photo: Shawn Hanna/Tribune Staff
Baha Mar in $6m monthly value fall By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net
Baha Mar’s value is declining at a rate of $6 million per month, a Supreme Court judge has revealed, with none of the purchase offers “anywhere near” to making its Chinese secured creditor ‘whole’. Justice Ian Winder disclosed the alarming extent of Baha Mar’s “depreciation” in a September 27, 2016, ruling, which sanctioned the process set out by the China Export-Import Bank and its Deloitte & Touche receivers for the project’s completion and ultimate sale. Finding that this process did not amount to “selfdealing” by either the receivers or the Chinese state-owned bank, Justice Winder revealed: “As the project continues in receivership, in its unfinished state, it depreciates at a rate of $6 million per month.” Based on this figure, and given that the receivers have been in place since late October 2015, it is possible that Baha Mar’s value has depreciated by some
Buyer offers ‘nowhere near’ making bank whole Judge: About 94% of local creditors to be paid Bank SPV’s offer ‘greatly exceeded highest bid’ $66 million as a result of the project being incomplete, unoccupied and unused. And this figure could be even higher, were the months between the late June 2015 Chapter 11 bankruptcy protection filing and Deloitte & Touche’s appointment factored into the calculations. Either way, Justice Winder’s ruling shows that it is in the interests of all parties, including the Bahamian people’s, for Baha Mar to be completed and opened as rapidly as possible. And he also confirmed See pg b5
Mall, Carmichael Road to open before Christmas Expecting quick returns from Yamacraw Solomon’s we envisaged to grow the brand, but we will have two more stores opening up See pg b9
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